Telcos

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By  Published  November 17, 2006
Etisalat #1

Government-backed operator Etisalat has enjoyed a monopoly in the UAE since 1976 but all this is set to change with the arrival of a competitor — operator du, which is expected to launch at the end of this year.

Regardless of impending competition, it has still been a good year for Etisalat. Mobile subscriber numbers in the UAE exceeded five million, representing a penetration rate in excess of 100%, according to the firm.

Fixed line penetration also increased, exceeding 30%, while internet users in the UAE reached one of the region’s highest figures, with over 40% penetration.

As it prepares to face competition in its home country, Etisalat has extended its footprint internationally, having entered a number of strategic markets, including Afghanistan and Egypt. It has also started talks to enter more than 15 other markets.

The operator has a 50% stake in West African mobile operator Atlantique Telecom, as well as smaller stakes in Thuraya Satellite Communications and PTCL. An Etisalat-led consortium also owns Saudi Arabia’s second GSM network operator, Mobily.

www.etisalat.ae


STC #2

Saudi Arabia’s telecommunications market has already opened up to competition in mobile and data services, and the regulator has hinted at licensing a third operator as well as bringing forward the liberalisation date for the fixed-line market.

However, despite the apparent enthusiasm for liberalisation, Saudi Telecommunications Company (STC) remains the Kingdom’s telco powerhouse.

Established in 1998, STC is the sole provider of fixed-line services in the Kingdom. Until the arrival of Mobily last year, the company was also the sole provider of mobile services.

The launch and subsequent success of Mobily has heralded a new phase in the market dynamics, forcing STC executives to take a long, hard look at the market. Customer service and customer retention efforts were virtually an unknown consideration to STC just two years ago, but in recent months it has made huge strides in upgrading its fixed, mobile and broadband networks. In August, for instance, STC’s mobile operation Al Jawal introduced a service allowing the delivery of content from CNN to mobile handsets.

www.stc.com.sa


MTC #3

Since 2003, MTC Group has grown from a one-country operator in Kuwait to a 20-country operator with operations in the Middle East and Africa. On an expansion side MTC has spent more than US$6 billion in its development in these regions and is continuously looking for new opportunities in Saudi Arabia, Asia, and Africa.

Last year, MTC carried out the then-biggest acquisition deal in the region when it bought African mobile operator Celtel International for US$3.4 billion. Since then Celtel has expanded and is now present in 14 African countries.

Under the leadership of its CEO Saad Al Barrak, MTC, was one of the first operators to put forth a strategy for growth. Its 3x3x3 strategy, which plans to take the company from a regional player, to international and finally global, has been a huge success so far. Today MTC has more than 23 million customers and 9,000 employees.

MTC has not only focused on expansion but also on its customers’ needs. It was the first operator in the Middle East to provide full 3G coverage for its customers in Bahrain, for example.

www.mtctelecom.com


Batelco #4

Since taking over at the helm of Batelco in June 2005, Peter Kaliaropoulos has been hard at work transforming Bahrain’s incumbent telco.

The operator has invested heavily in upgrading its networks over the past year, both its mobile network and working on its broadband enhancements as part of its Broadband Bahrain initiative. Batelco is set to launch HSDPA commercially by the end of the year.

The operator has also been investing in staff training, spending US$1.4million on its workforce in the first half of this year.

Batelco is Bahrain’s only fixed-line services operator. It also provides voice, mobile, internet and IT services.

A monopoly provider until the end of 2003 but now facing competition from MTC-Vodafone Bahrain, Batelco is 36.7% owned by the Bahrain Government and 20% by Cable & Wireless.

Away from home, Batelco recently acquired third-placed, but rapidly growing GSM operator Umniah in Jordan. Batelco also has activities in Egypt, where it has a subsidiary, and in Kuwait.

www.batelco.com


Orascom #5

Egyptian operator Orascom is one of the largest mobile telecom operators in the MEA and the Indian sub-continent.

The company’s GSM mobile networks operate in countries such as Algeria, Bangladesh, Congo, Egypt, Iraq, Pakistan, Tunisia and Zimbabwe. These operations are part of Orascom Telecom Holding, which is controlled by the Sawiris family and listed on the Egyptian and London Stock Exchanges.

Orascom has shifted focus to concentrate on high-growth countries, and reduced debt by selling off GSM operations in 15 territories. Its divestments have not affected its growth, however — the firm more than doubled its number of subscribers in 2005, reaching over 30 million by year-end.

In addition to GSM mobile communication services, Orascom is a major internet service provider in Egypt.

It also provides satellite international gateway services through its M-Link subsidiary, telecom infrastructure support through OrasInvest, infrastructure construction via Contra, mobile handset distribution, and other telecom support services.

Orascom appears keen to grow, reaching out for international expansion this year. In December, it bought a 19.3% stake in Hutchison Telecom for US$1.3 billion and is rumoured to be interested in raising its stake in the firm.

It has since made unsuccessful bids for stakes in Nigerian operator Nitel as well as Serbian mobile operator Mobi 63.

www.orascom.com


Wataniya #6

Kuwait’s population may be only 2.5 million, but the country’s two mobile operators, MTC and Wataniya Telecom, have approached the development of the market as if it were 10 times the size it actually is.

Second operator Wataniya, may have launched more than a decade after incumbent MTC, but it has still been making a serious bid for domination in its home market whilst also making waves on the regional scene through its Wataniya International arm.

One of the major focuses for Wataniya has been customer service, through its ‘Red Carpet’ campaign.

Last year, Wataniya entered a deal worth US$125 million with Nokia for the implementation of advanced technologies to enhance the operator’s network.

Wataniya has a number of foreign investments including in Orascom Telecom Tunisia, National Mobile Algeria and the Asia-Cell consortium in Iraq.

www.wataniya.com


Fastlink #7

Founded in 1995, Jordanian company Fastlink has fast earned a reputation as a progressive telecom operator in the region in terms of its competitiveness and readiness to adopt new technologies and deploy new services.

The operator was the first to introduce mobile phone services in the country and recently won the award for best new non-voice service for its Fastlink blog at the CommsMEA awards.

The service provides an online interactive community where users can set up their own blog and publish articles using web, MMS and SMS.

In 2003, the majority of stock invested in Fastlink was transferred to Kuwaiti mobile operator MTC in what was considered at the time the largest private sector investment in the country.

Fastlink currently has more than two million subscribers, in comparison to its next closest rival, MobileCom, which as of October 2005 had 615,000.

www.fastlink.com.jo


Qtel #8

Having enjoyed a monopoly in Qatar thus far, Qatar Telecom or Qtel, the sole provider of telecommunications services in the country, now faces the onset of competition after the Emir issued a new law in November restructuring the information and communication system in the country and paving the way for competition.

Qatar was the last country in the Middle East to liberalise its telecoms market.

However, Nasser Marafih, CEO of Qtel, claims the operator is ready to fight its ground having started a transformation plan almost three years ago in preparation for the legislative change.

The programme focuses on increasing operational efficiency as well as creating a number of initiatives to become more customer oriented.

Predicting that its toughest battle will be on mobile services, Qtel is aiming to increase its customer focus so that when an alternative arrives on the scene, churn is kept to a minimum. Qtel launched its 3G services commercially this year.

International investment is another part of its grand plan and the firm is expected to announce a number of such investments soon. It is already a controlling shareholder of Nawras, the second operator in Oman.

As of September 2006, Qtel has over 1,551,400 fixed, mobile and business customers in Qatar and Oman, with Nawras representing around 475,000 of that number.

www.qtel.com.qa


Investcom #9

Beirut-based Investcom was acquired by South Africa’s MTN for US$5.5 billion in May this year, having been listed on the London and Dubai stock exchanges a year earlier.

The move to MTN was seen as a surprise one by some industry insiders, as executives had previously said the firm was committed to remaining an independent mobile operator.

The last set of annual financial results before the acquisition by MTN saw Investcom report net profit for 2005 to end-December up 31% year on year to US$207.8 million. Gross operating revenues during the period amounted to US$903 million, representing a 43% growth rate.

Investcom has operations in ten countries in Africa, the Middle East and Europe. In the Middle East, it operates mobile telecommunications networks in Syria and Yemen.

Investcom also has GSM licences to build and operate mobile networks in Afghanistan and Guinea. It announced in March it was launching services in Guinea under the brand name Areeba. Areeba’s offering includes national and international mobile services such as SMS, multiple and conference calls, and voice mail services.

As of the end of 2005, Investcom counted 4.9 million subscribers in total, up 91% from a year earlier.

www.investcomllc.com

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